‘The NHS is the largest customer-facing business in the country. We have to listen more to the people in our care,’ says Sir Keith Pearson. Photograph: Graham Turner for the Guardian

The boss of a trade association can usually be relied upon to defend its members when the going gets tough. However, in exceptional circumstances, the news may be so bad that defence is inappropriate. That is what Sir Keith Pearson decided in February last year when the NHS ombudsman, Ann Abraham, published a devastating report on how the NHS treated older people without compassion or dignity.

Pearson was only a few months into his role as chairman of the NHS Confederation, the umbrella body that speaks for the local organisations that run hospitals, mental health, primary care and other health services for NHS patients. Abraham gave a graphic account of the disgraceful treatment given to 10 older people in various NHS facilities across England. She described the stories as "harrowing" and pointed out "the stark contrast between the reality of the care they received and the principles and values of the NHS". In one case, a "feisty and independent" woman of 88 was transferred from a hospital in Birmingham to a care home on Tyneside, arriving bruised, soaked in urine, dishevelled and wearing someone else's clothes held up with large paper clips.

Deeply shocking

Pearson says: "I can remember when the report landed. We could have given a standard response. We could have said: this is really bad, but we must remember it does not reflect what usually happens. But we took the view that this was a hugely important document. It said something about the NHS that was deeply shocking. When you read the report, and then read it for a second time, it resonated with every one of us. It described something we knew was wrong. So we took a decision to do something different. And that meant we had to hold the feet of the NHS to the fire and say: this is not good enough."

The confederation joined forces with the Local Government Association (LGA) and the charity Age UK to set up a commission of inquiry into what could be done to improve the dignity of older people in hospitals and care homes.

Since then, poor hospital care for older people has been thrust further into the spotlight with critical reports by the Care Quality Commission and Patients' Association. Nearly half of hospitals were found to be failing to provide good nutrition to elderly patients, while 40% did not offer dignified care, according to the healthcare watchdog.

The Commission on Improving Dignity in Care publishes a draft report for consultation on Wednesday, looking at how the NHS and care homes must change if they are to deliver dignity in care. A long list of recommendations amounts to root-and-branch reform of the system. For example, it tells NHS boards to abandon the command-and-control style of management that has disempowered staff on the frontline; to give ward sisters the authority to take whatever action is necessary in the interests of patients; and to require staff to spend time on every shift discussing feedback from older people and their families, reflecting on how care could improve.

The report, Delivering Dignity, also calls for the development of national quality standards for dignity and for payments to be withheld from hospitals that fail to deliver. It even recommends that doctors and nurses should be selected for jobs as much on the basis of their compassion as on academic prowess.

The National Institute for Health and Clinical Excellence (Nice) last week issued new guidelines intended to improve hospital care by setting standards for delivering dignity. Pearson welcomes the guidance and calls on all NHS organisations to use the standards to measure their performance and to publish the results in annual quality accounts. But he wants a lot more.

"The NHS is the largest customer-facing business in the country," he says. "We have to listen more to the people in our care. We have to understand the passions that may have provoked a complaint, or more often a suggestion. The problem may be a little thing that could have been done better. For example, an older person may not have been able to find spectacles or dentures. If you run a business that puts dignity at its heart, you will organise for these items to be put away carefully in a box in the person's locker. The spectacles will always be cleaned before they are put away. The hearing aid will always be checked before it is fitted to make sure the battery is working."

That's easy to say, but how does the NHS make good things happen, reliably, across every department in every institution? Pearson suggests that NHS hospitals may need to follow the example of the John Lewis partnership, which recruits staff according to the person's values and then trains them in the necessary skills. "We might want to consider how psychometric testing could be used to establish whether someone has the kind of personality that puts a high value on providing care with dignity," he says.

Confidence

He speaks with the confidence of a self-made man who was wealthy enough by the age of 50 to step off the career ladder. Pearson left school at 18 and found a job in the health and safety sector before moving to Bupa, the private health insurer. He worked there for 17 years, ending up as chief executive for all the Hong Kong-based companies. In 1993 he was headhunted by Aon, the US-based health insurer, to run its operations in east Asia, based in Singapore. He massively increased Aon's revenue in the region before retiring from the company in 1997, when he returned to Britain and set up an international healthcare consultancy.

He does not like being described as rich, but says: "I am sufficiently independent to choose what roles I take on." Work for the NHS started with the chairmanship of a small primary care group in south Somerset. That led to a series of NHS board appointments. He played a key role in drawing up the NHS constitution. That experience, he says, helped him to understand the NHS.

"I work long hours and I do it because I have a passion for healthcare and particularly for the empowerment of patients," he says.

Pearson does not have the authority to instruct hospitals to adopt the policies outlined in today's report. Neither can the LGA impose the long list of recommendations for care homes on the local authorities that pay for a large slice of residential care. And Age UK can advocate for change, but not command it.

Pearson is nonetheless optimistic. He does not accept that the NHS in a time of austerity cannot afford to give a higher priority to dignity. Nor does he think the government's proposed NHS reforms will make it harder for trusts to respond. In his view, the changes in the health bill are largely irrelevant to the task.

Older people make up 60% of the patients on NHS wards. Providing them with dignified care is not an optional extra. It should be the core purpose of the NHS, he insists. Or as Pearson puts it: "For us, this is the day job."